refer to the following diagram. Initially, wage rates are WM in Country M and WU in Country U. Subsequent migration results in an equalization of wage rates.
-The combined gain in efficiency of the two countries is equal to:

Question

refer to the following diagram. Initially, wage rates are WM in Country M and WU in Country U. Subsequent migration results in an equalization of wage rates.

-The combined gain in efficiency of the two countries is equal to:

Quizplus · Accepted Answer

The combined gain in efficiency is the difference between the area under the new production possibility curve and the area under the old production possibility curve. This is represented by the area kijl - area ebcf.

Refer to the Following Diagram